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What is an Accountable Care Organization?

After the passage of the Affordable Care Act, the healthcare world began hearing a lot of discussion about Accountable Care Organizations (ACOs). These entities are networks of hospitals, doctors and other health care providers that take on not only the medical responsibility for a group of patients, but financial responsibility as well. The overall idea is that the organization (hospital or hospital system, typically) will focus on providing more efficient, highly coordinated care that improves health outcomes and reduces costs. If the ACO is able to reduce the overall cost of care, then the ACO gains financial incentives for doing so. Medicare gave us the first wave of ACO development, though many private insurance companies have rolled out ACO programs nationwide as well. The core aspect of the model is consistent, regardless of who is writing the checks: get patients better and prove it, and you’ll get a piece of the money saved.


Medicare ACO Models: Moving from quantity to quality

Hospital Systems can form into a Medicare ACO, and have several specific models to pursue. The Medicare Shared Savings Program helps fee for service providers receive incentives for reducing costs and improving performance standards on quality of care. The Advance Payment ACO Model provides provider groups or health systems up-front payments to help them invest in infrastructure costs related to coordinating and streamlining care. This program is geared towards physician-based and rural providers that may not have the startup capital needed to advance the development of their organization. The Pioneer ACO Model allows some health systems with experience in coordinating patient care to move more rapidly through a shared savings model into a population-based payment model. Medicare has stated that they plan to move 30% of fee-for-service payments into some form of performance based payment model like an ACO by the end of 2016. They plan to move 50% of payments to these kinds of payment models by the end of 2018. Even outside of these specific models, Medicare plans to tie 90% of payments to some form of quality or value by 2018.

How Do ACOs Make Money?

The fee-for-service aspect of care does not go away entirely with a hospital system that opts to become an ACO, nor is this specific program the entirety of their business. What the ACO programs do is provide incentives for improving outcomes and reducing costs. Prior to these models being available, a “fee-for-service” model dominated our national system. Simply put, the more you do, the more you earn, regardless of the health of the patient. It’s easy to see how such a system can drive up costs, unless we blindly assume that revenue has absolutely no impact on treatment decisions. Generally speaking, the ACO model shifts the financial incentives from greater volume to better outcomes, and it does this through better coordination of care. If doctors and other healthcare providers communicate, coordinate treatment, avoid duplication of tests and help support treatment goals that may not be directly their own, then the patient not only gets better, but the cost of treating them would likely go down as well. As a simple example, consider the depressed cardiac patient that is seeing both a physician and a psychologist. The psychologist might lean toward social or relational strategies in treating the depression, but may be inclined to include health-related lifestyle changes to treat the depression if they knew it would support the goals of the primary care doctor. Conversely, the physician may be careful not to prescribe medications that contribute to any psychological symptoms if they are well-informed of what is happening in the psychotherapy office. You can imagine how treatment on both sides might improve, though there is absolutely no financial reimbursement for this kind of communication in the fee-for-service world. In the ACO model, you allow providers a path to make more money if they focus on this kind of high-quality collaboration (which we all want to do, but rarely get time for). This is whee things are supposed to head under ACOs.

How Does Behavioral Health Fit In?

Great question, and for the most part, no one knows just yet. Many healthcare systems across the country have been acquiring medial services and medical specialty services by either buying up practices around them or forming partnerships with other entities. It far easier to coordinate care and improve outcomes if those services fall under one roof (and thus, share infrastructure). Behavioral health (or mental health, if you prefer) is a distinctly different set of services and providers, in almost every sense. Very, very few hospital systems have behavioral health divisions comprehensive enough to cover the kinds of outpatient services needed to truly improve outcomes for the majority of their medical patients. On top of that, many (but not all) of the most highly trained behavioral health clinicians are drawn to private practice, given that the reimbursement rates tend to be much better in that environment. So how does a vast, complex health system efficiently interface with thousands of behavioral health specialists in a highly coordinated and efficient manner? That seems to be one of the biggest topics on the table for ACOs in 2016. One example of how that might play out in the midwest is Behavioral Care Management, a healthcare startup that has brought together hundreds of behavioral health providers into a network that can interface with ACOs in the Chicago area. Behavioral Care management, or “BCM” is using a private directory from EarlyByrd as a robust ACO-facing interface that includes secure referrals, regardless of what EMR system the hospital uses. BCM is a really unique concept because the startup was largely funded by the behavioral health providers themselves. It’s likely that similar solutions will emerge across the country, either organized on the side of the behavioral health providers, or by the ACO themselves. It’s very likely that we’ll see new networks emerge with this in mind.

How Does a Solo Provider Stay Informed?

Connect, connect, connect. Healthcare mergers and partnerships are happening all over the country, every month. If you have a hospital system in your back yard (or several), make sure that you receive their newsletters. It’s also a great idea to connect with the care coordinators or intake department. Knowing these “switchboard operators” can not only connect you to them in a meaningful way in terms of patient care, but it can help you remain informed about any major changes in the healthcare system. State mental health associations are another great resource, particularly at conventions. Finally, if you begin to mirror the practice strategies that are the foundation of the ACO model, you’re more likely to not only know what’s going on, but will be ready to ship your practice methods to function well within an ACO network. Do you see patients that also see another healthcare provider? If so, collaborate and communicate!

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